Seminar On “Development of Mutual Fund Industry in Nepal”September 16, 2005
Everest Bank Ltd, a joint venture with Punjab National Bank (PNB), is one of the fastest growing private sector Banks having a wide network of 16 branches across the nation and over 250 correspondents around the globe. The bank has shown track record of profitability registering remarkable growth in its size and operation. The bank has always endeavored in introducing innovative products for the benefit of the individuals and the growth of the economy. Similarly, in its attempt to developing the capital market in Nepal for the benefit of the individuals, business houses and the institutions which will give them higher return on Investment than the normal deposits and also contribute to development activities of the country, Everest Bank Ltd organized the seminar on “Development of Mutual Fund Industry in Nepal”, bringing the expertise from its joint venture partner, PNB and Principal Financial Group of USA.
The Mutual Fund Industry in Nepal is still in nascent stage. The various options/ schemes that are available to investors’ worldwide are not available to the local investors. Likewise, the benefits that may accrue by way of development of Capital Market and infrastructure Industry due to the operation of the Mutual Funds are also not seen. The latest monetary policy of the NRB makes a mention of their desire to develop this Industry.
The speakers for the seminar were chosen carefully to suit/ understand the requirements of our country using their worldwide experience. Sri Ranjan Dhawan is a General Manager of PNB, previously the Head of the AMC and Mutual Fund Coy of PNB. Mr. Ashok Bhargav is a Senior Manager at Principal Mutual , a part of the Principal Financial Group , which is a fortune 100 coy having global presence with more than 15 customers and managing assets worth over USD 175 billion across the world.
A mutual fund is simply a financial intermediary that allows a group of investors to pool their money together with a predetermined investment objective. The mutual fund will have a fund manager who is responsible for investing the pooled money into specific securities (usually stocks or bonds). When you invest in a mutual fund, you are buying shares (or portions) of the mutual fund and become a shareholder of the fund. Mutual funds are one of the best investments ever created because they are very cost efficient and very easy to invest in (you don’t have to figure out which stocks or bonds to buy). By pooling money together in a mutual fund, investors can purchase stocks or bonds with much lower trading costs than if they tried to do it on their own and the biggest advantage to mutual funds is diversification.
– Provides an option to systematically start planning for ones retired life and secure a sound financial return in future
– Availibity of very attractive short term, medium term and long term investment options to suit every class of investors, based on their individual appetite for risk
– Professional Fund Management which would lead to better returns for investors
– Benefits of free markets as competition would lead to lower costs which would improve overall returns
– Transparency in operations
Thus with the view of providing alternative avenues of investments to the benefits of the investors and the alternative source of raising fund to the benefit of the corporate, Everest Bank Ltd, PNB & the Principal Financial Group aims at working closely with the regulator to help develop the framework for introducing a strong long term social security in Nepal. We can jointly work to put in place a framework to offer Mutual Funds/ Retirment Products via Everest Bank’s Branches.